Item 2.01. Completion of Acquisition or Disposition of Assets.
On December 31, 2019, National Holdings Corporation (the "Company") completed
its previously announced acquisition of all of the outstanding equity interests
(collectively, the "Purchased Shares") of Winslow Evans & Crocker, Inc., a
Massachusetts corporation ("WEC"), Winslow, Evans & Crocker Insurance Agency,
Inc., a Massachusetts corporation ("WIA"), and Winslow Financial, Inc., a
Massachusetts corporation ("WF" and collectively with WEC and WIA, the
"Targets") pursuant to terms of a Stock Purchase Agreement, dated as of August
26, 2019 (the "Original Purchase Agreement"), by and among certain sellers named
therein (the "WEC Sellers"), Daniel Santanello ("Santanello"), Robert Maloney
("Maloney" and, together with Santanello and the WEC Sellers, the "Sellers"), as
amended by Amendment No. 1, dated as of October 11, 2019 (the "First Amendment"
and, together with the Original Purchase Agreement, the "Purchase Agreement").
The transactions contemplated by the Purchase Agreement are collectively
referred to as the "Transactions."
At the closing of the Transactions (the "Closing"), the Company acquired the
Purchased Shares for an aggregate purchase price of approximately $3.2 million
paid in cash, less certain adjustments. Under the Purchase Agreement, the
Sellers are entitled to additional consideration to be based on (i) the amount
of net operating capital of WEC and WF as of the Closing, payable in three
annual installments and not to exceed $1.0 million in the aggregate, (ii) the
aggregate pre-tax net income (loss) of the Targets through September 22, 2022,
provided that such additional consideration shall not be less than $1.5 million
and shall not exceed $3.0 million in the aggregate, and (iii) a portion of the
synergies achieved through September 20, 2022.
The foregoing descriptions of the Purchase Agreement and the Transactions do not
purport to be complete and are qualified in their entirety by reference to the
Original Purchase Agreement, a copy of which was filed with the Company's
Current Report on Form 8-K filed on August 29, 2019 as Exhibit 2.1 and is
incorporated herein by reference, and the First Amendment, a copy of which was
filed with the Company's Current Report on Form 8-K filed on October 17, 2019 as
Exhibit 2.1 and is incorporated herein by reference.
The representations, warranties and covenants contained in the Purchase
Agreement were made only for the purposes of the Purchase Agreement, were made
as of specific dates, were made solely for the benefit of the parties to the
Purchase Agreement and may not have been intended to be statements of fact but,
rather, as a method of allocating risk and governing the contractual rights and
relationships among the parties thereto.
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